Why You’re Paying Too Much For Your Phone And What You Can Do About It

When an older person hobbles through the door of a phone store, there is a voice that goes off inside every employee’s head that says, ‘Oh boy, here we go’.

But for all their misunderstanding of how mobile technologies work, I must pay our elders credit where credit is due. Seniors, wary of their phones, are never complacent when it comes to their bills or the service they’re receiving. The minute something goes awry, they question it and they want answers. They’re vigilant.

After two years working in a phone store, the sheer number of people who are wasting huge amounts of money on their phone every month is staggering. It doesn’t have to be this way.

Below are some strategies to help save you money on one of your biggest and most misunderstood expenses: your phone plan.

Rate Plan Change

When most people sign up to a 24-month agreement, they assume that there’s nothing they can do until the contract is up. Those people would be wrong.

The phrase ‘locked in’ when referring to a phone contract is a bit of a misnomer. The fees on plans where you’re paying off a device can be split in two: the amount you pay for your handset, and your fee for accessing the network (otherwise known as your rate plan). When you sign a contract you can make changes to your rate plan but the handset repayments will always stay the same.

For example, if you signed up to a 24 month contract for $60 in 2015 with a $15 handset repayment, it’s likely that the 2017 version of that same $60 plan has more inclusions (ie: data). You should be able to switch onto the current version of the plan without incurring any fees or adding any time onto the contract term. You’ll still be paying $75 every month, but getting more inclusions (more data) for the same price.

SIM Only Plans

A 24 month contract can be tricky for a few reasons, chief among them being that your needs will most likely change before that time comes to an end. It’s difficult to be able to adapt to your lifestyle and adjust your spending when your phone is at a fixed rate that isn’t necessarily giving you what you need.

The solution is the SIM Only plan, where you’re only paying for access to the network, not your handset.

You see, despite the fact that you’re paying a handset repayment fee, rate plans for handsets also subsidise the handset. So handset plans have significantly lower inclusions than SIM Only plans.

For example, a 24 month $40 handset plan will only have around 1-2 gigs of data every month on top of whatever call inclusions you’re getting. A 12 month $40 SIM only plan should get you anywhere between 6-12 gigs depending on what specials providers are offering.

With the SIM Only plan you also have the option of going on a month to month contract, which means you have more freedom to toggle your monthly spend as your circumstances change.

So, when you come out of your 24 month contract, it pays to hold onto your old phone for as long as possible – or you could buy a phone outright – and go on a SIM Only plan.

Making the Switch

Loyalty doesn’t really mean what it used to. Unless you’re a customer with a significant number of connections (we’re talking more than 10), there’s very little that a company is likely to be able to do for you in terms of discounts … and, no, it doesn’t matter if you’ve been with the company for ten years. Please stop saying that.

The reason for this is that prices are, generally, already as low as they can go. If another provider is offering something that will suit you better, it’ll save you a lot of time and stress to make the jump instead of bargaining.

Key to switching providers, however, is timing. February-March and June-July are often when Telcos pump up the inclusions and lower costs.

If you’re in the market for a handset plan and aren’t able to buy outright, when big ticket manufacturers (like Apple and Samsung) launch their handsets, that’s often when plans are at their cheapest. Because lots of people are switching, companies are begging for your business and dramatically reducing costs, or pumping up inclusions, to get you to change over. It pays to shop around.

Use Your ABN

Chances are, in these times of shaky employment and short-term projects, you got an ABN.

Phone companies go crazy for business customers and are prone to offering heaps of benefits, which can include recurring discounts, access to priority care, early plan upgrades and some providers offer access to suites of business apps.

Signing up a business customer also usually means extra commission for employees… use it to your advantage.

So when it comes to phone plans be vigilant and stop phoning it in. It’ll save you heaps in the long run.

Anthony Nocera is a freelance writer and full-time homosexual from Adelaide. His work has appeared in Krass Journal and Archer Magazine and he is a frequent contributor to CityMag. He is the founder of Folly Press, and the publisher of Hook Up Zine.

This information is intended to be general in nature and should not be relied upon for personal financial use.